UK property giant British Land stayed upbeat on Thursday despite its underlying profits falling 2.6% to £380 million. That fall came after the sale of income-producing assets in recent years but pre-tax profits rose to £195 million in its latest financial year as it benefitted from a more-than-£500 million rise in value of its properties.

Meadowhall owner British Land is upbeat on its retail properties The company said its portfolio value, which includes 1.2m sq ft of leasing activity, rose by 4.5%.

And despite a tough UK retail environment, its retail activities seem to be prospering. The company’s retail property pipeline has doubled to 1.6 million sq ft, which means an estimated future rent value of £63 million. Some 55% of that pipeline is either under offer or already pre-let.

The company said that its retail properties, including high quality, well located regional and local assets, are now focused on a smaller number of larger, multi-let places with mixed use potential.

It added that the retail markets is challenging “with many occupiers facing short-term headwinds” and that "polarisation is accelerating, but we are confident that the quality and range of our space meets retailers' evolving needs in the omnichannel retail world.”

Of course, it has been affected by the spate of UK retailers entering into company voluntary arrangements (CVAs), but its retail values still rose 0.3% last year and its leasing activity generated £7 million in additional rent. “At 98% occupancy, our portfolio is effectively full and is outperforming benchmarks on both footfall and sales,” it said.

During the year, it made acquisitions in Woolwich, Southeast London and in Ealing, adjacent to its existing Ealing Broadway shopping centre. “Both are well-connected mixed use assets with development potential,” it said. In addition, it completed the £60 million refurbishment of Meadowhall “to ensure it is well positioned to meet the changing demands of consumers into the future.”

And it has plenty of plans for the future, including it Canada Water masterplan that “will create a new urban centre for London” and will add a major new shopping centre to the city.